[House Report 109-261]
[From the U.S. Government Publishing Office]
109th Congress Rept. 109-261
HOUSE OF REPRESENTATIVES
1st Session Part 1
======================================================================
STOPP ACT OF 2005
_______
October 31, 2005.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Goodlatte, from the Committee on Agriculture, submitted the
following
R E P O R T
[To accompany H.R. 3405]
[Including cost estimate of the Congressional Budget Office]
The Committee on Agriculture, to whom was referred the bill
(H.R. 3405) to prohibit the provision of Federal economic
development assistance for any State or locality that uses the
power of eminent domain power to obtain property for private
commercial development or that fails to pay relocation costs to
persons displaced by use of the power of eminent domain for
economic development purposes, having considered the same,
report favorably thereon with an amendment and recommend that
the bill as amended do pass.
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Strengthening the Ownership of Private
Property Act of 2005'' or the ``STOPP Act of 2005''.
SEC. 2. CONDITIONS OF FINANCIAL ASSISTANCE UNDER FEDERAL ECONOMIC
DEVELOPMENT PROGRAMS.
(a) Prohibition of Assistance.--
(1) Prohibition.--If, after the date of the enactment of this
Act, an entity using the power of a State engages in any
conduct described in subsection (b), no officer or employee of
the Federal Government having responsibility over Federal
financial assistance under any Federal economic development
program shall make such assistance available to the relevant
entity during the period described in paragraph (3).
(2) Entity to which assistance is prohibited.--In this
subsection, the term ``relevant entity'' means--
(A) the entity engaging in the conduct described in
subsection (b), if that entity is a State or a unit of
general local government of a State; and
(B) the State or unit of general local government
that gave authority for the entity to engage in that
conduct, in any other case.
(3) Duration of prohibition.--The period referred to in
paragraph (1) is the period that begins on the date the officer
or employee of the Federal Government having responsibility
over Federal financial assistance under the Federal economic
development program determines that the relevant entity has
engaged in the conduct described in subsection (b) and ends
with the earlier of--
(A) the day that is two years after the date the
period began; or
(B) the day that the property is returned to the
entity from whom the property was taken.
(b) Conduct Resulting in Prohibition of Assistance.--The conduct
described in this subsection is the following:
(1) Any use of the power of eminent domain to take property
from a private entity and transfer the ownership of, or a
leasehold interest, in the property (or a portion thereof) to
another private entity, except for a transfer--
(A) for use by a public utility;
(B) for a road or other right of way or means, open
to the public or common carriers, for transportation;
(C) for an aqueduct, pipeline, or similar use;
(D) for a prison or hospital; or
(E) for any use during and in relation to a national
emergency or national disaster declared by the
President under other law.
(2) Failure to provide relocation assistance for persons
displaced by use of eminent domain for economic development.--
Failing to provide, to any person displaced from property by
the use of the power of eminent domain for any economic
development purpose, relocation assistance under the Uniform
Relocation Assistance and Real Property Acquisition Policies
Act of 1970 (42 U.S.C. 4601 et seq.) in the same manner and to
the same extent as relocation assistance would be required
under such Act to be provided by a Federal agency that
undertakes a program or project that results in displacement of
the person.
SEC. 3. PRIVATE RIGHT OF ACTION.
The owner of any real property taken by conduct resulting in the
prohibition by this Act of assistance may, in a civil action, obtain
injunctive and declaratory relief to require the enforcement of that
prohibition.
SEC. 4. DEFINITIONS.
In this Act:
(1) Federal economic development program.--The term ``Federal
economic development program'' means any of the following
programs:
(A) Department of agriculture.--
(i) Forest service.--
(I) Programs under the National
Forest-Dependent Rural Communities
Economic Diversification Act of 1990 (7
U.S.C. 6611 et seq.).
(II) The rural development through
forestry program authorized by the
Department of the Interior and Related
Agencies Appropriations Act, 2006
(Public Law 109-54; 119 Stat. 538), and
subsequent appropriations laws.
(ii) Rural business-cooperative service.--
(I) The intermediary relending
program under section 1323 of the Food
Security Act of 1985 (7 U.S.C. 1932
note).
(II) The rural business opportunities
grant program under section 306(a)(11)
of the Consolidated Farm and Rural
Development Act (7 U.S.C. 1926(a)(11)).
(III) The program for assistance to
cooperatives for economic development
under the Act of July 2, 1926 (7 U.S.C.
451 et seq.) and subtitle A of the
Agricultural Marketing Act of 1946 (7
U.S.C. 1621 et seq.).
(IV) The rural business enterprise
grants program under section 310B(c) of
the Consolidated Farm and Rural
Development Act (7 U.S.C. 1932(c)).
(V) The rural economic development
loans and grants program under title
III of the Rural Electrification Act of
1936 (7 U.S.C. 930 et seq.).
(iii) Rural utilities service.--
(I) The program for grants, direct
loans, and guaranteed loans for water
and waste disposal systems for rural
communities under paragraphs (1) and
(2) of section 306(a) of the
Consolidated Farm and Rural Development
Act (7 U.S.C. 1926(a)).
(II) The Rural Utilities Service
program for grants and loans to the
Denali Commission under section
19(a)(2) of the Rural Electrification
Act of 1936 (7 U.S.C. 918a(a)(2)).
(iv) Rural housing service.--
(I) The rural community development
initiative pursuant to the Agriculture,
Rural Development, Food and Drug
Administration, and Related Agencies
Appropriations Act, 2001 (Public Law
106-387; 114 Stat. 1549A-17) and the
Agriculture, Rural Development, Food
and Drug Administration, and Related
Agencies Appropriations Act, 2005
(Public Law 108-447; 118 Stat. 2826).
(II) The program for loans and grants
for essential community facilities
under section 306(a)(1) of the
Consolidated Farm and Rural Development
Act (7 U.S.C. 1926(a)(1)).
(v) Farm service agency.--The program for
loans to Indian tribes and tribal corporations
under the Consolidated Farm and Rural
Development Act (7 U.S.C. 1921 et seq.).
(vi) Rural business investment program.--The
rural business investment program under
subtitle H of the Consolidated Farm and Rural
Development Act (7 U.S.C. 2009cc et seq.).
(B) Department of commerce--economic development
administration.--Any program for financial assistance
under the Public Works and Economic Development Act of
1965 (42 U.S.C. 3121 et seq.).
(C) Department of housing and urban development.--
(i) The community development block grant
programs under title I of the Housing and
Community Development Act of 1974 (42 U.S.C.
5301 et seq.), including the entitlement
grants, small cities, special purpose and
insular areas grants, States, Indian tribe
grants, and loan guarantee programs.
(ii) The brownfields economic development
initiative under section 108(q) of the Housing
and Community Development Act of 1974 (42
U.S.C. 5308(q)).
(iii) The rural housing and economic
development program of the Department of
Housing and Urban Development pursuant to title
II of the Departments of Veterans Affairs and
Housing and Urban Development, and Independent
Agencies Appropriations Act, 2005 (Public Law
108-447; 118 Stat. 3300) and title II of the
Departments of Veterans Affairs and Housing and
Urban Development, and Independent Agencies
Appropriations Act, 1999 (Public Law 105-276;
112 Stat. 2475).
(iv) The Indian housing block grant program
under the Native American Housing Assistance
and Self-Determination Act of 1996 (25 U.S.C.
4101 et seq.).
(D) Department of the interior--bureau of indian
affairs.--The programs for grants, loans, and loan
guarantees for Indian economic development of the
Office of Economic Development, Bureau of Indian
Affairs of the Department of the Interior.
(E) Department of the treasury.--The community
development financial institutions fund program under
subtitle A of title I of the Riegle Community
Development and Regulatory Improvement Act of 1994 (12
U.S.C. 4701 et seq.).
(F) Appalachian regional commission.--Any program for
assistance for Appalachian regional development under
subtitle IV of title 40, United States Code.
(G) National credit union administration.--The
community development revolving loan fund program for
credit unions under the Community Development Credit
Union Revolving Loan Fund Transfer Act (42 U.S.C. 9822
note).
(H) Denali commission.--The Denali Commission program
under the Denali Commission Act of 1998 (42 U.S.C. 2131
et seq.).
(I) Delta regional authority.--The program for Delta
regional development under subtitle F of the
Consolidated Farm and Rural Development Act (7 U.S.C.
2009aa et seq.).
(J) Department of health and human services.--The
discretionary award program relating to local community
economic development under section 680 of the Community
Services Block Grant Act (42 U.S.C. 9921).
(2) Federal financial assistance.--The term ``Federal
financial assistance'' has the meaning given such term in
section 101 of the Uniform Relocation Assistance and Real
Property Acquisition Policies Act of 1970 (42 U.S.C. 4601).
(3) State.--The term ``State'' means any of the States of the
United States, the District of Columbia, the Commonwealth of
Puerto Rico, the Commonwealth of the Northern Mariana Islands,
Guam, the Virgin Islands, American Samoa, and any other
territory or possession of the United States.
SEC. 5. SEVERABILITY.
If any provision of this Act, or the application thereof, is held
invalid, the validity of the remainder of this Act and the application
of such provision to other persons and circumstances shall not be
affected thereby.
BRIEF EXPLANATION
H.R. 3405 prohibits Federal agencies from providing funding
to a state or local government under specified Federal economic
development programs for two years under certain conditions.
Two conditions result in the prohibition of funding. First,
H.R. 3405 prohibits funding to a state or local government that
uses the eminent domain power to transfer property from a
private entity to another private entity unless the transfer is
for a use listed as an exception. The exceptions include use by
a public utility; a road or other right of way or means, open
to the public or common carriers for transportation; an
aqueduct, pipeline, or similar use; a prison or hospital; or
any use during and in relation to a national emergency or
national disaster declared by the President. Second, H.R. 3405
prohibits funding to a state or local government that fails to
provide relocation assistance to a person displaced from
property by any use of eminent domain for a economic
development purpose. Relocation assistance must meet the level
and be of the same manner as that required under the Uniform
Relocation and Real Property Acquisition Policies Act of 1970.
H.R. 3405 provides landowners a private right of action to
enforce the prohibition of funds under this Act.
PURPOSE AND NEED
Private ownership of property is vital to our freedom and
our prosperity, and is one of the most fundamental principles
embedded in our Constitution. The founders realized the
importance of property rights when they codified the Takings
Clause of the Fifth Amendment to the Constitution, which
requires that private property shall not be taken ``for public
use, without just compensation.'' This clause created two
conditions to the government taking private property: that the
subsequent use of the property is for the public and that the
government gives the property owners just compensation.
However, the Supreme Court's recent 5-4 decision in Kelo v.
City of New London is a step in the opposite direction. This
controversial ruling expands the ability of state and local
governments to exercise eminent domain powers to seize property
under the guise of ``economic development'' when the ``public
use'' is as incidental as generating tax revenues or creating
jobs, even in situations where the government takes property
from one private individual and gives it to another private
entity.
By defining ``public use'' so expansively, the Court
essentially erased any protection for private property as
understood by the founders of our nation. In the wake of this
decision, state and local governments can use eminent domain
powers to take the property of any individual for nearly any
reason. Cities may now bulldoze private citizens' homes, farms,
and small businesses to make way for shopping malls or other
developments.
For example, in California a local government used eminent
domain to acquire 24 acres of land consisting of single family
homes, a motel and other small businesses. After reaching deals
with 11 of the 34 property owners, the city approved eminent
domain proceedings to take the remaining property to make way
for a warehouse store. Congress must take steps to stop these
types of abuses.
H.R. 3405, the Strengthening The Ownership of Private
Property (STOPP) Act of 2005, as amended by the House
Agriculture Committee, would create a strong incentive for
state and local governments to refrain from using eminent
domain powers to take private property from one owner and give
it to another private owner. Specifically, thislegislation
prohibits all federal economic development funding for localities and
states that use eminent domain in this way. The legislation also
withholds federal economic development funding from any state or local
government that uses eminent domain for economic development purposes,
and does not then comply with the procedures in the Uniform Relocation
Act, which would require state and local governments to pay relocation
costs for individuals affected by eminent domain proceedings.
SECTION-BY-SECTION
Section 1. Short title
Section 2. Conditions of financial assistance under federal economic
development programs
(a) Prohibits the Federal government from providing
financial assistance, as defined in Section 4, to relevant
entities when a State or unit of local government engages in
conduct defined under subsection (b). The relevant entity is
either the entity engaging in the conduct described in
subsection (b) or the State or unit of general local government
that gave authority for the entity to engage in that conduct in
any other case. The period of prohibition shall begin on the
date that a Federal officer or employee determines the entity
engaged in such conduct and continue until either 2 years have
passed or the entity returns the property to the owner.
(b) Defines two types of conduct that result in prohibition
of assistance. The first conduct described is any use of
eminent domain to take property and transfer ownership or
leasehold from a private entity to another private entity.
Provides an exception for transfers for the following purposes:
(1) Use by a public utility;
(2) A road or other right of way or means, open to
the public or common carriers, for transportation;
(3) An aqueduct, pipeline or similar use;
(4) A prison or hospital, or;
(5) Any use during and in relation to a national
emergency or national disaster declared by the
President under other law.
The second type of conduct is failure to provide relocation
assistance to any person displaced by the use of eminent domain
for any economic development purpose. This assistance must be
of the same manner and extent as that required of the Federal
government under the Uniform Relocation Assistance and Real
Property Acquisitions Policies Act of 1970.
Section 3. Private right of action
Provides any property owner whose property is taken by
conduct resulting in prohibition of assistance under this Act
the right to obtain injunctive and declaratory relief to
enforce the prohibition.
Section 4. Definitions
Defines Federal Economic Development Program, Federal
Financial Assistance, and State.
Section 5. Severability
Provides that if any portion of this Act is held invalid,
the remainder of the Act is not affected by the ruling.
COMMITTEE CONSIDERATION
I. Hearings
On September 7, 2005, the Committee on Agriculture held a
hearing on the impact of the Kelo v. City of New London
Decision and to analyze the merits of H.R. 3405, the
``Strengthening the Ownership of Private Property (STOPP) Act
of 2005.
The panel of witnesses included The Honorable Henry
Bonilla, Member of Congress from Texas and author of the bill,
H.R. 3405; The Honorable Maxine Waters, Member of Congress from
California; Mr. Bob Stallman, President, American Farm Bureau
of Washington, D.C.; Mr. Christopher Bartolomucci, Partner,
Hogan & Hartson L.L.P., of Washington, D.C.; Mr. Alva J.
Hopkins, III, Chairman, Government Affairs Committee, Forest
Landowners Association, Inc., of Atlanta, Georgia; Ms. Dana
Berliner, Senior Attorney, Institute for Justice of Washington,
D.C.; The Honorable William J. Howell, Speaker of the House,
House of Delegates, Virginia General Assembly, on behalf of the
American Legislative Exchange Council of Washington, D.C.; Dr.
Roger Pilon, Founder and Director, Center for Constitutional
Studies, CATO Institute of Washington, D.C.; and Mr. Jonathan
Turley, Professor of Public Interest Law, George Washington Law
School of Washington, D.C.
II. Full Committee consideration
The Committee on Agriculture met, pursuant to notice, with
a quorum present, on October 7, 2005, to consider H.R. 3405,
legislation to prohibit the provision of Federal economic
development assistance for any State or locality that uses the
power of eminent domain to obtain property for private
commercial development or that fails to pay relocation costs to
persons displaced by use of the power of eminent domain for
economic development purposes.
Chairman Goodlatte called the meeting to order and made an
opening statement as did Ranking Member Peterson, Ms. Herseth,
and Mr. King. Without objection, H.R. 3405 was placed before
the Committee and open for amendment at any point. Counsel was
then recognized to give a brief summary of the bill.
Discussion occurred and Chairman Goodlatte then placed
before the Committee an Amendment in the Nature of a Substitute
to H.R. 3405, offered by himself, Mr. Peterson, Mr. Pombo, and
Ms. Herseth, to be considered as original text for purposes of
amendment.
Brief discussion occurred regarding the Amendment in the
Nature of a Substitute to H.R. 3405. However, there being no
further amendments, the Amendment in the Nature of a Substitute
was adopted by a voice vote.
Mr. Peterson moved that H.R. 3405, as amended, be reported
favorably to the House with the recommendation that it pass. By
a recorded vote of 40 yeas--1 nay, H.R. 3405, as amended, was
ordered favorably reported to the House. See Rollcall Vote No.
1.
Chairman Goodlatte then advised Members that pursuant to
the Rules of the House of Representatives that Members have 2
calendar days to file such views with the Committee. Mr.
Marshall indicated that he intended to submit an additional
statement for the record. The Chairman stated that the record
would be kept open for five business days to receive additional
material.
Without objection, staff was given permission to make any
necessary clerical, technical or conforming changes to reflect
the intent of the Committee.
Chairman Goodlatte thanked all the Members and adjourned
the meeting subject to the call of the Chair.
REPORTING THE BILL--ROLLCALL VOTES
In compliance with clause 3(b) of rule XIII of the House of
Representatives, the Committee sets forth the record of the
following rollcall votes taken with respect to H.R. 3405.
Rollcall No. 1
Summary: Motion to favorably report H.R. 3405, as amended
to the House with the recommendation that it pass.
Offered by: Mr. Peterson.
Results: Adopted by a vote of 40 yeas/ 1 nay/ 5 not voting.
YEAS
1. Goodlatte 21. Schmidt
2. Pombo 22. Peterson
3. Everett 23. Holden
4. Lucas 24. McIntyre
5. Moran 25. Etheridge
6. Jenkins 26. Baca
7. Gutknecht 27. Cardoza
8. Hayes 28. Scott
9. Johnson 29. Marshall
10. Osborne 30. Herseth
11. Pence 31. Butterfield
12. Graves 32. Cuellar
13. Bonner 33. Melancon
14. King 34. Costa
15. Musgrave 35. Salazar
16. Neugebauer 36. Barrow
17. Boustany 37. Pomeroy
18. Kuhl 38. Larsen
19. Foxx 39. Davis
20. Conaway 40. Chandler
NAYS
1. Case
NOT VOTING
1. Boehner
2. Rogers
3. Schwarz
4. Fortenberry
5. Boswell
COMMITTEE OVERSIGHT FINDINGS
Pursuant to clause 3(c)(1) of rule XIII of the Rules of the
House of Representatives, the Committee on Agriculture's
oversight findings and recommendations are reflected in the
body of this report.
BUDGET ACT COMPLIANCE (SECTIONS 308, 402, AND 423)
The provisions of clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives and section 308(a)(1) of the
Congressional Budget Act of 1974 (relating to estimates of new
budget authority, new spending authority, new credit authority,
or increased or decreased revenues or tax expenditures) are not
considered applicable. The estimate and comparison required to
be prepared by the Director of the Congressional Budget Office
under clause 3(c)(3) of rule XIII of the Rules of the House of
Representatives and sections 402 and 423 of the Congressional
Budget Act of 1974 submitted to the Committee prior to the
filing of this report are as follows:
U.S. Congress,
Congressional Budget Office,
Washington, DC, October 19, 2005.
Hon. Bob Goodlatte,
Chairman, Committee on Agriculture,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 3405, the
Strengthening the Ownership of Private Property Act of 2005.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Gregory
Waring.
Sincerely,
Donald B. Marron
(For Douglas Holtz-Eakin, Director).
Enclosure.
H.R. 3405--Strengthening the Ownership of Private Property Act of 2005
H.R. 3405 would direct federal agencies to deny economic
development assistance to any state or local entity that
violates either of two prohibitions on its use of the power of
eminent domain. First, a government could not use the power of
eminent domain to transfer ownership of property from one
private entity to another, unless the transfer is for one of
several purposes listed in the bill. Second, a government could
not use eminent domain for economic development purposes
without providing relocation assistance to displaced property
owners. The denial of federal assistance would continue for two
years or until the affected jurisdiction returns the property
at issue to its original owner. Finally, the bill would give
private property owners the right to bring civil actions to
seek enforcement of these prohibitions if they are subject to a
prohibited action.
CBO expects that implementing the bill would have no
significant impact on the federal budget because most
jurisdictions would not risk the economic development
assistance they receive from the federal government by using
eminent domain as described in the bill. Further, a few states
are considering legislation that would restrict the authority
of localities to take private property for economic development
projects. By denying economic assistance for up to two years to
localities using eminent domain in a way proscribed in the
bill, the pace of spending for some grant programs could be
marginally reduced. Enacting the bill would not affect direct
spending or revenues.
The bill specifies several programs operated by the
Departments of Agriculture, Commerce, Housing and Urban
Development, and other agencies as subject to the potential
denial of federal assistance. As a result of the bill's
disincentive to use eminent domain for private property
transfers and the small likelihood that a jurisdiction would
put its federal assistance in jeopardy, CBO assumes that H.R.
3405 would not have a significant impact on spending for the
specified federal programs.
H.R. 3405 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act, but
would impose significant new conditions on the receipt of
federal economic development assistance by state, local, and
tribal governments. These governments receive assistance
totaling about $6.5 billion each year from the programs that
could be affected by the bill. Because these conditions would
apply to such a large pool of funds, the bill effectively would
restrict the use of eminent domain, and would have a
significant impact on local governments' powers to manage land
use in their jurisdictions. The requirement to pay relocation
assistance also could result in additional costs for state and
local governments. Further, state and local governments
probably would incur significant additional legal expense to
respond to private legal actions authorized by the bill.
The CBO staff contacts for this estimate are Gregory Waring
(for federal costs) and Marjorie Miller (for the state and
local impact). This estimate was approved by Peter H. Fontaine,
Deputy Assistant Director for Budget Analysis.
PERFORMANCE GOALS AND OBJECTIVES
With respect to the requirement of clause 3(c)(4) of rule
XIII of the Rules of the House of Representatives, the
performance goals and objectives of this legislation are to
prohibit the provision of Federal economic development
assistance for any State or locality that uses the power of
eminent domain power to obtain property for private commercial
development or that fails to pay relocation costs to persons
displaced by use of the power of eminent domain for economic
development purposes.
CONSTITUTIONAL AUTHORITY STATEMENT
Pursuant to clause 3(d)(1) of rule XIII of the Rules of the
House of Representatives, the Committee finds the
Constitutional authority for this legislation in Article I,
clause 8, section 18, that grants Congress the power to make
all laws necessary and proper for carrying out the powers
vested by Congress in the Constitution of the United States or
in any department or officer thereof.
COMMITTEE COST ESTIMATE
Pursuant to clause 3(d)(2) of rule XIII of the Rules of the
House of Representatives, the Committee report incorporates the
cost estimate prepared by the Director of the Congressional
Budget Office pursuant to sections 402 and 423 of the
Congressional Budget Act of 1974.
ADVISORY COMMITTEE STATEMENT
No advisory committee within the meaning of section 5(b) of
the Federal Advisory Committee Act was created by this
legislation.
APPLICABILITY TO THE LEGISLATIVE BRANCH
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act (Public Law
104-1).
FEDERAL MANDATES STATEMENT
The Committee adopted as its own the estimate of Federal
mandates prepared by the Director of the Congressional Budget
Office pursuant to section 423 of the Unfunded Mandates Reform
Act (Public Law 104-4).